UPDATE 1-VW's Audi confirms Hackenberg to become R&D chief

Fri Jun 21, 2013 7:52am EDT

* Audi has faced criticism for lack of innovation

* Hackenberg led development of cost-friendly production

* Considered close confidant of VW chairman (Adds background)

FRANKFURT, June 21 (Reuters) - Volkswagen's Audi division on Friday confirmed it has appointed Ulrich Hackenberg as head of research and development, replacing Wolfgang Duerheimer, who is being moved to another post.

Hackenberg will start his new job next month and take on the additional responsibility of coordinating development among VW's various brands on a group level.

Audi Chief Executive Rupert Stadler interpreted the 63-year-old's appointment as a signal of the luxury marque's importance to Volkswagen. "This strengthens the role of our brand within the overall group," he said.

Reuters reported on Thursday that Hackenberg would replace Duerheimer, who spent only 10 months on the job amid growing criticism that Audi was losing the race for innovation to larger rival BMW. Spiegel Online had earlier reported on Duerheimer's demotion.

Hackenberg will be returning to Audi, where he was responsible for introducing a new flexible and cost-effective production method based on a so-called modular toolkit that was later refined and adopted by the rest of the group.

These toolkits, known as MLB for larger vehicles and MQB for smaller ones, increase the commonality not only between VW's brands but across entire vehicle segments, allowing the group to lower purchasing costs and reduce manufacturing time.

Volkswagen, which traditionally stood for over-engineered vehicles, is now increasingly being considered a cost leader thanks to the MQB toolkit that Morgan Stanley estimates will create annual gross savings of $19 billion over the next few years.

Hackenberg assumed his current post as VW brand R&D chief in early 2007 after following then-Audi CEO Martin Winterkorn to VW's group headquarters as part of a shake-up that lifted Winterkorn to the top of Europe's largest carmaker.

Engine development chief Hans-Jakob Neusser will succeed Hackenberg as VW brand R&D chief, VW said on Friday. (Reporting by Christiaan Hetzner; Editing by David Goodman)

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